401(k) Optimal Contribution Calculator - Maximize Your Employer Match

401(k) Match Maximizer Calculator

Current Age

*Annual Salary Income ($):

per year

Employer Match Rate 1 (%):

Maximum Employer Match Eligible 1 (% of salary):

Employer Match Rate 2 (%):

Maximum Employer Match Eligible 2 (% of salary):

How to Use This Calculator

Step-by-Step Instructions:

Enter Your Age: This determines your annual contribution limit (catch-up contributions apply at 50+)
Input Annual Salary: Your gross annual income before taxes
Configure Match Rate 1: The percentage your employer matches for the first tier (typically 50-100%)
Set Match Limit 1: The salary percentage eligible for the first match rate (usually 3-6%)
Configure Match Rate 2: The percentage for the second tier (often lower than first tier)
Set Match Limit 2: The total salary percentage eligible for matching (typically 6-10%)

Understanding Your Results:

Minimum Recommendation: Contribute this percentage to receive the full employer match
Maximum Recommendation: The highest amount you can legally contribute
Visual Charts: Show the breakdown between your contributions and employer match

Key Strategies:

Priority 1: Always contribute enough to get the full employer match (free money!)
Priority 2: Consider maximizing contributions for tax benefits
Priority 3: Balance 401(k) with other retirement accounts (IRA, Roth IRA)
Annual Review: Adjust contributions when salary changes or employer match updates

Understanding 401(k) Employer Matching

Common Employer Match Structures

Most employers use one of these matching formulas:

Simple Match: 50% match up to 6% of salary (most common)
Tiered Match: Different rates for different contribution levels
Dollar-for-Dollar: 100% match up to a certain percentage
Discretionary Match: Varies based on company performance

Mathematical Formula for Employer Match

For Tiered Matching System:

Layer 1 Match = (Salary × Match Limit 1) × Match Rate 1

Layer 2 Match = (Salary × (Match Limit 2 - Match Limit 1)) × Match Rate 2

Total Employer Match = Layer 1 Match + Layer 2 Match

Optimal Contribution Calculation:

Minimum Recommended = Salary × Maximum Match Eligible Percentage

Maximum Allowed = Lesser of (Annual IRS Limit, Salary × 100%)

2026 Contribution Limits

Under 50: $24,500 maximum annual contribution
Age 50+: $32,500 maximum (includes $8,000 catch-up contribution)
Age 60-63: $35,750 maximum (includes $11,250 catch-up contribution)
Total contributions (employee + employer) cannot exceed $72,000 (or $80,000 for age 50-59 and 64+, $83,250 for age 60-63)

Frequently Asked Questions

What Is the 2026 401(K) Contribution Limit?

For 2026, the contribution limit is $24,500 for participants under 50 years old, and $32,500 for those 50 and older (including the $8,000 catch-up contribution), and $35,750 for those 60 to 63 (including the $11,250 catch-up contribution).

How Does Employer Matching Work?

Employer matching is when your company contributes money to your 401(k) based on how much you contribute. Common formulas include 50% match on the first 6% of salary, or 100% match on the first 3% of salary.

Should I Contribute the Maximum to My 401(K)?

It depends on your financial situation. At minimum, contribute enough to get the full employer match. If you can afford more and have no high-interest debt, maximizing your 401(k) can provide significant tax benefits and retirement security.